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Mexico's Banorte to add 800 jobs to tap into nearshoring
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Chile's peso briefly hits 5-week highs
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Brazilian real inches up ahead of fiscal framework
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Peru prosecutors probe president, ex-president for alleged
money
laundering
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Latam FX up 0.6%, EM currencies slip 0.1%
(Updates prices, details; adds comment)
By Shreyashi Sanyal and Bansari Mayur Kamdar
March 29 (Reuters) -
Latin American currencies outperformed emerging market peers on Wednesday, while the Brazilian real made small advances as President Luiz Inacio Lula da Silva was set to finalize the proposal for a new fiscal framework later in the day.
The MSCI's index for Latin American currencies added 0.6%, extending its rally for eighth straight session. Chile's peso briefly firmed to about 786.54 against the dollar, the strongest in five weeks. The currency was last up 0.5%, gaining for the third straight day as copper prices improved on easing worries about global banking crunches and hopes of improving demand from top consumer, China.
The peso is headed for quarterly gains of 6.8%, among the top performing currencies across Latin America.
"With the removal of some of the uncertainties following the Silicon Valley fallout over the last couple of weeks, the Chilean peso is among the first ones to recover, given also the recovery in copper prices," said Luis Hurtado, director of Latin American FX at CIBC Capital Markets.
Rising copper prices also helped lift the currency of the world's second largest producer, Peru's sol , about 0.9%. Prosecutors are investigating President Dina Boluarte and former President Pedro Castillo for allegedly laundering money as part of a criminal organization. "When you talk to investors, they will tell you they have come used to the political and corruption news that comes out of Peru if you take a view of what has happened in Peru over the last six years," Hurtado added. Castillo was removed from office in December after attempting to dissolve Congress before an impeachment vote, while Boluarte ascended to the presidency in the wake of his removal and arrest. Brazil's real added 0.1%, lagging peers as a highly anticipated fiscal framework was to be finalized by Wednesday.
Institutional Relations Minister Alexandre Padilha told reporters the leaders of Brazil's Congress have indicated that, once submitted, the fiscal rules should be quickly approved.
Meanwhile, Brazil's federal public debt grew 1.51% in
February from the month before, the Treasury said, marked by a
further increase in issuance costs.
Data showed Brazil created a net 241,785 formal jobs in
February, far exceeding economists' expectations of 161,000
jobs.
Other currencies including those of Mexico and
Colombia gained 0.8% and 1.4%, respectively, taking cues
from higher oil prices.
Colombia's central bank is seen raising the interest rate by
25 basis points to 13% at its meeting on Thursday, while the
Bank of Mexico is expected to hike its key rate to 11.25%.
Stocks across Latin America also rose, with the MSCI's index up 0.8% tracking a broader theme of no further
cracks emerging in global banking in recent sessions.
Mexican lender Grupo Financiero Banorte added 0.9% after its chairman told Reuters it was preparing to
hire 800 new employees to tap into growing demand from global
companies moving their manufacturing operations to Mexico.
Key Latin American stock indexes and currencies at 1830 GMT:
Stock indexes Latest Daily %
change
MSCI Emerging Markets 978.79 0.83 MSCI LatAm 2157.81 0.8
Brazil Bovespa 100528.15 -0.65
Mexico IPC 53733.24 0.99
Chile IPSA 5288.69 0.84
Argentina MerVal 248558.55 2.547
Colombia COLCAP 1122.10 0.42
Currencies Latest Daily %
change
Brazil real 5.1600 0.10
Mexico peso 18.0850 0.77
Chile peso 794.8 0.20
Colombia peso 4612.5 1.37
Peru sol 3.7443 0.21
Argentina peso (interbank) 208.2900 -0.22 Argentina peso (parallel) 389 2.06 (Reporting by Shreyashi Sanyal, Shashwat Chauhan and Bansari
Mayur Kamdar in Bengaluru; Editing by Richard Chang)
